By JAMES KUNDA-
NDOLA Lime Company Limited (NLC) has recorded a loss of K11.9 million after tax, in the financial year ended March 31, 2014, due to a reduction in sales volumes and increase in production costs.
According to the Zambia Consolidated Copper Mines-Investment Holdings (ZCCM-IH) annual report for 2014, the company earned K197.5 million in the material financial year compared to K214.6 million in 2013.
“Ndola Lime Company reported total revenues for the financial year ended 31 March 2014 of K197.5 million (2013: K214.6 million) and a loss after tax of K11.9 million (2013: K21.5 million),” the report states.
The reported states that NLC’s performance during the second half of 2013 was adversely affected by a reduction in sales volume arising from an increase in the price of Heavy Fuel Oil (HFO), which was the company’s most significant operating cost item.
The Energy Regulation Board of Zambia (ERB) increased prices of HFO and diesel by 39 per cent and 24 per cent respectively in May 2013 and for NLC that had the dual effect of higher direct input costs and higher quicklime uncompetitive prices.
Meanwhile, ZCCM-IH director Cosmas Mwananshiku said the firm continued to provide financial support through shareholders loans towards the completion of the Ndola Lime recapitalisation project.
“The recapitalisation project at NLC continued and the company obtained an additional shareholder loan of US$3.5 million from ZCCM-IH towards funding for the Ndola Lime Recapitalisation Project, subsequent to the year end, ZCCM-IH extended a further US$5million loan to NLC,” Mr Mwananshiku said.
He said one of the projects under the NLC recapitalisation project was the second Vertical Kiln (VK-2) which was to be commissioned at the end of October, this year.
Mr Mwananshiku said the VK-2 would significantly improve production efficiencies at the company with a resultant effect of reducing the cost of production for limestone products.
Mr Mwananshiku said the use of coal in the VK-2 as opposed to HFO would greatly enhance the prospects of reducing operating costs thus making the products competitive.
